How is your DSL?
Speaking to some technicians and marketing executives in the company, there is not a clear plan to link even their exchanges with fibre optic cables. In fact, degraded copper cables still remain some places including the Legon area.
It surely makes business sense for Vodafone to be focused on their cellular business. However, with the lion’s share of our existing Internet infrastructure under their control, I believe they are stifling the progress of software development in two ways. First, developers cannot get much done with current service levels – unless you are willing to pay an arm and a leg for top tier connections. Secondly, the market for web applications and content is tightly constrained by reliability and cost of Internet as it mars the experience and affects penetration. The company is essentially retarding the growth of the Internet in the Ghana.
Some may be optimistic about the situation due to the increasing competition in the sub-marine fibre cable space as I once did. The changes in this area was expected to force prices down but it appears that the market is highly imperfect – with a near monopoly that does not need to make money. With MainOne connectivity starting at $20,000 for 45Mbps the change that was anticipated has not arrived. I hope I am wrong but I do not think that GloOne would change the dynamics.
Looking at the gains in mobile broadband services in both speed and reliability, I am convinced that much of the problem lies within the transmission to the end user. Mobile broadband in 3G however has tighter constrains in capacity and speed than fixed broadband. Fourth Generation (4G) definitely has the potential to replace fixed broadband with speeds of up to 1Gbps [1]. Mobile broadband pricing actually compares well with the United Kingdom [2].
How would the the Internet landscape in Ghana change if Vodafone was to spin off its broadband business? Would this lead to better service levels and even a reduction in cost? Will Ghana & Africa leapfrog fixed broadband to 4G as we have analogously done with fixed telephony and mobile? While we still lack perfect competition, would it be prudent to advocate that government regulation is used to ensure better services?
[1] – http://en.wikipedia.org/wiki/4g
[2] – http://www.t-mobile.co.uk/shop/mobile-broadband/mbb-pay-upfront-3-months/usb-stick-610-3-months/
you hit the nail just right there. hoping to more this in the next blog